India will contribute 17% to global growth; IMF praised the strong performance of the Indian economy

The International Monetary Fund (IMF) has praised India for maintaining fiscal discipline in the election year. That said, the economy is performing well. Its growth of 6.8% is very good. Krishna Srinivasan, Director of Asia and Pacific Department at IMF, said, India will contribute 17% to global growth.

Srinivasan said inflation is coming down. It should be brought to the set target. After all, solid macro fundamentals are the foundation on which countries prosper and achieve sustainable growth. It is very important to maintain it.

According to Srinivasan, India has faced many shocks over the years. Have overcome it. It is emerging as one of the fastest-growing major GDPs. The current financial year is estimated to grow at 6.8% led by private consumption and government investment. Inflation is continuously decreasing in India. It is now below 5%.

Srinivasan said India is a great place. The position of foreign exchange reserves is strong. The overall macro fundamentals are good. Risks to the economy are broadly balanced. The private sector can spend more on capital investment in India.

According to Srinivasan, the second driver is digital public infrastructure (DPI). What DPI does is increase productivity by promoting competition and innovation. It also promotes financial inclusion and makes the government sector more efficient.

India topped the list with 46% of real-time transactions in 2022, Economic Affairs Secretary Ajay Seth informed World Bank committee members. In March of this year, there were 13.44 billion monthly transactions. It came to a total of Rs 19.78 lakh crore.

In the December quarter, the volume of UPI online transactions increased by 54% year over year. Increased mobile connectivity and bank account integration are now essential components of India's story of inclusive economic growth.

The demand for investments and consumer goods has helped India's economy grow significantly over the past year. The government has approved a budgetary expenditure of Rs 103 billion to support startups, develop AI capabilities, and improve the innovative ecosystem.

RBI has said that the current policy stance is right. But going forward we need to be careful about food inflation. Releasing the minutes of the MPC meeting this month, the central bank said, there is a need to be cautious of factors such as external contingencies that could disrupt the disinflation process. The MPC has expressed concern over the inflation rate that continues to remain high despite the recent decline. Emphasized the need to maintain pressure on inflation until clear risks emerge. Five MPC members voted to keep the repo rate unchanged.